Are you an employer with 50 or more full-time equivalent employees (also known as an ALE) and are required to file forms 1094 and 1095? Do you have someone assisting you with this task, or are you the one responsible to file the ACA forms? The information reported on Form 1094-C and Form 1095-C is used in determining whether an employer owes a payment under the employer shared responsibility provisions. Below is some information on some of the basics.
1. What forms must an ALE member file with the IRS to report the required information under sections 6055 and 6056?
An ALE member must file a separate Form 1095-C (or a substitute form) for each of its full-time employees, and a transmittal on Form 1094-C (or a substitute form) for all of the returns filed for a given calendar year. These forms must be filed regardless of whether the ALE member offers coverage, or the employee enrolls in any coverage offered.
2. For which employees must an ALE member file Form 1095-C?
Generally, an ALE member must file Form 1095-C (or a substitute form) for each employee who was a full-time employee of the ALE member for any month of the calendar year. (But see question 4 below for exceptions.) In addition, an ALE member that sponsors a self-insured plan must file Form 1095-C for each employee who enrolls in the self-insured health coverage or enrolls a family member in the coverage, regardless of whether the employee is a full-time employee for any month of the calendar year.
3. What information must an ALE member furnish to its full-time employees?
An ALE member must furnish to each full-time employee a completed Form 1095-C (or a substitute form). This form must be furnished regardless of whether the ALE member offers coverage, or the employee enrolls in any coverage offered. An ALE member is not required to furnish to its full-time employees a copy of Form 1094-C as filed with the IRS.
4. For which employees is an ALE member not required to file a Form 1095-C?
Form 1095-C is not required for the following employees (unless the employee or the employee’s family member was enrolled in a self-insured plan sponsored by an ALE member):
- an employee who was not a full-time employee in any month of the year; or
- an employee who was in a limited non-assessment period for all 12 months of the year (for example, a new variable hour employee still in an initial measurement period). See the definition of Limited Non-Assessment Period in the instructions to Form 1095-C for more details.
5. Which ALE members should complete Part III of Form 1095-C?
An ALE member that sponsors a self-insured health plan should complete Part III of Form 1095-C for employees and family members who enroll in the self-insured coverage. If an ALE member sponsors a health plan that includes self-insured options and insured options, the ALE member should complete Part III of Form 1095-C only for employees and family members who enroll a self-insured option. An ALE member that offers coverage through an employer-sponsored insured health plan (and does not sponsor a self-insured health plan) should NOT complete Part III. Instead, information about coverage will be furnished to employees on Form 1095-B, which is filed by the insurance provider.
In the next blog, I’ll share information on reporting offers of coverage and enrollment information.
